The solar installation is a logical decision for many homeowners to escape the rising electricity cost. According to every solar company sales pitch, solar panel installation can save you thousands. Is it hype or not? Reduction in the utility bills sounds convenient, but is this smart investment worth it. The installation cost of the solar panel is high, so will it help you save dollars. It depends on several factors.

Electric bill review

Solar panels don’t need fuel to produce power, so can significantly balance the monthly utility bill or completely eliminate it. If your utility rate and billing amount are high, you will possibly benefit from installing solar panels on your roof. Electricity usage and rates are volatile, which can impact the savings amount. 

Appraise sunlight exposure

The solar panels need sufficient sun rays to produce energy. More sunlight means more energy production and huge potential for savings. States with more than average sunlight can benefit from the high energy output from the solar panels. 

Cost of the solar panel system 

The installation and solar panel cost will differ from one company to another. Several solar panel systems need low maintenance and designed to serve for more than 20 years with negligible impact on the power generated. You may get tempted towards buying cheap solar panels to save some dollars, but the total savings for 20 years’ service will be higher if you choose high-quality equipment. 

When you calculate the total cost, consider monthly energy usage and system size needed to generate the necessary wattage. Some online solar-estimate calculators can be helpful. You know the current energy usage number, so calculating the cost of solar panels is easy. Get quotes from several solar companies and compare, before making a choice.

Research solar incentives & rebates

The government offers huge incentives and rebates to homeowners for solar panel system installation. It can reduce your overall cost by 50% and more. In the US, the federal government offers a 26% solar tax credit. Other states offer extra incentives like credits, cash backs, waived fees, property tax exemption, and expedited permits. Homeowners can even sell the extra energy generated from their solar system to the local utility companies. 

Solar panel system financing

If you are capable to pay in cash for the solar panel system, then you will save more than other financing options. However, even if you opt for a $0-down solar loan, you can save significantly. For example, the long-term savings on cash payment across 20 years is $20,000, whereas on a $0-down loan is 14,000. Under PPA [power purchase agreement], the savings for 20 years is $7,300.

Is solar panel investment worth, if you are not in sunny states?

Solar adores sunlight but even in states with snowy winters, there are many panels installed. The homeowners there save a lot because the electricity rates are high and their states offer better incentives. 

If you are planning to install a solar panel system, then shop around to look for incentives and save on the total cost!

Edward Bertrand